Real slam dunk for the markets yesterday, absolute carnage that really played out with the biggest one-session fall in the last four years. 31 lakh crores was the kind of BSE market cap erosion we saw. What does one do?
Thank God it ended yesterday. We were waiting for the market to close. 9:15 to 3:30 is the longest day I must have seen in many-many years and the market was relentless. So, I think the reactions were overdone. The excesses were created on Monday because of the exit poll getting it all wrong and people leveraging in PSUs and so on of defence. I always held the view that defence and railways were overpriced to 2027 level and PSU selective are very-very frothy.
I think that is a very healthy correction which has taken place. You have seen the comeback of FMCG. We think insurance, IT, these will be the better place. But this market is a retail-driven market and the retail investor is very sanguine. He is not eitherly optimistic or pessimistic. He will take this with a pinch of salt that we are in a market which is going to be more driven on macro and micro. Oil is at a three-month low. Dollar is below 104. Bond yields are at 4.33 and rainfall is expected to be good. So, after the few days humdrum, it will be back to running the government. And I think historically, from my perspective, coalition governments are better.
There will be nothing to be tinkering on the long term of capital. So, a lot of positives, but sectoral rotation which may take place. I would expect stability in the next 48 hours.
So, let us answer that question for our viewers as well kya lena hai?
I go with insurance. I think HDFC Life has done nothing in the last one year. It is very-very attractively poised, gross net value additions, all this humdrum of surrender value and the IRDA is overplayed.
There will be no such thing in the medium term. Insurance will regain its posture. It is a good defensive play. HDFC Life and SBI Life become part of that. HCL Tech and Wipro are very two key players which we are very-very bullish. Wipro particularly we think will be a standout.
We are very bullish on Coal and NTPC. We think whatever the PSU attitude, Coal and NTPC are universal businesses and they should be added in your portfolio.
And last but not least, the AB Group. ABFRL, I have been saying 25,000 crore market cap against 1.5 for Trent, having all the retail brands from Van Heusen, Peter England and salability across the length and breadth of India.
This stock is going to be a doubler from here. Vodafone Idea will be the ones which will be biggest gainers because of ARPU rise and so on. And if you missed buying it at 12, 12.5, today could be the opportunity.
What about a defensive tilt, that seems to be the flavour of the market in light of this kind of volatility. Is that something as well that you would advocate?
Yes, so I think FMCG fits the bill which we yesterday suggested. Hindustan Lever, Godrej Consumer, Nestle, those I missed out. Those are three more of our picks which we have. We also added Adani Wilmar. We think Adani Wilmar, leave aside the tag of Adani that will get digested, but Adani Wilmar as an edible oil player is now the third largest in the world.
We think this business is going to be a very-very sharp turnaround and numbers will be very-very strong in the coming quarter. You must add this at this price.